General Tax Code of Cameroon 2018

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INTRODUCTORY PROVISIONS

GENERAL PROVISIONS

Section 1: (1) This Law shall institute the General Tax Code.
(2) Book I contains the various type of taxes (Sections 2 to 613).
(3) Book II contains the Manual of Tax Procedures (Sections M.1 to M. 147).
(4) Book III contains the local fiscal system (Sections C.1 to C. 149)
(5) For the General Tax Code, instead of:

  • Director of Taxes, read Director General of Taxes;
  • Taxation Department, read General Taxation Department;
  • Main Taxation Centre, read Regional Taxation Centre;
  • Main Taxation Head, read Regional Taxation Centre Head.

BOOK ONE

TAXES AND DUTIES

PART I

DIRECT TAXES
CHAPTER I
COMPANY TAX
DIVISION I
GENERALITIES

Section 2.- A tax shall be levied on all profits or income made by companies and other corporate bodies.
This tax shall be known as company tax.

DIVISION II

SCOPE OF APPLICATION

Section 3.- Subject to the provisions of Section 4 below and the special tax schemes, the following shall be liable to company tax:
(1) joint stock companies and limited liability companies, co-operative societies, public establishments or bodies:
• irrespective of their object, public limited liability companies, joint stock companies, co-operative societies and their unions;
• public establishments, State bodies with financial autonomy and any other corporate bodies carrying out one or more gainful activities.
(2) Civil companies
(a) even if they do not fall under the type of companies referred to in paragraph 1, civil companies carrying out commercial, industrial, non-industrial or agricultural activities, in particular:
• when they are involved in intermediary transactions for the purchase or sale of property or businesses, shares or holdings of real estate companies, or when they buy generally on their own behalf assets intended for resale;
• when they parcel and sell lands acquired in return for payment following development and provision of services;
• when they give out for rental a commercial or industrial establishment possessing the furniture and equipment necessary for its operation, whether the rental comprises or not all or part of the intangible elements of the goodwill;
• when they let or sublet entire or part of furnished buildings which they own or manage.
(b) civil companies whose members include one or more companies with share capital or which opted for this form of taxation;
(c) civil companies which have opted for company tax under the conditions fixed for partnerships.
(3) Partnerships which have opted for company tax:
• partnership firms;
• limited liability partnerships;
• joint-ventures;
• financial syndicates.
The option is irrevocable and may not be applied by unincorporated companies or by partnerships originating from the previous transformation of partnerships. For the option to be valid, it shall be signed by all the partners and notified to the tax inspector of the area within three months of the beginning of the financial year. Failing an option, the company tax shall be levied on the share of profits corresponding to the rights of:
•partners in limited liability partnerships;
• partners not indefinitely liable or whose names and addresses have not been communicated to the Administration in partnership firms, joint-ventures and financial syndicates.
(4) Public establishments and regional and local authorities: Public establishments other than scientific, educational and aid bodies, as well as associations and regional and local authorities not subject to company tax by virtue of another provision, due to the rental of their built-on and non-built-on estates, revenue from floating capital not liable to tax on revenue from the transferable securities they possess as well as any other gainful activity. These provisions shall apply to the companies, associations and bodies referred to in accordance with the rules and procedures governing commercial law.
(5) Microfinance institutions irrespective of their legal form and their nature.

Section 4.- The following shall be exempt from company tax:
(1) Co-operative societies engaged in the production, processing, conservation and sale of agricultural and livestock produce, together with associations of such co-operatives, functioning in pursuance of the relevant statutory provisions but excluding the following operations:
•selling in retail stores distinct from their main premises;
• processing goods or by-products other than those intended for human or animal consumption, or likely to be used as raw materials in agriculture, livestock or industry;
• business done by the above-mentioned co-operative societies or associations with non-members.
(2) Agricultural and pastoral unions, supply and purchase co-operatives operating pursuant to the provisions governing them;
(3) Agricultural mutual credit funds;
(4) Mutual-aid societies and associations;
The profits made by non-profit associations which organize, with the help of local councils or public bodies, fairs, exhibitions, sports meetings or other public events for an object defined by
(5) their statutes and of acknowledged economic and social interest;
(6) Regional and local authorities and their public-utility services;
(7) Societies or bodies, responsible for rural development, which are recognized as being of public utility;
(8) Public boards for the allocation of low-cost housing;
(9) Private clubs and societies, for their non-profit-making activities;
(10) Non-profit private education establishments; this exemption shall
equally apply under the same conditions to industrial and commercial profits.
(11) The National Social Insurance Fund on the part on the benefit that
deals with salaries.
(12) Open-end investment companies (SICAV), mutual investment funds
and mutual credit funds for profits made as part of their legal activity.
(13) Economic interest groups, for the share of their profits distributed to
their members that are natural persons.
(14) Public hospital establishments.

DIVISION III

TAXABLE PROFITS

Section 5.- Profits liable to the company tax shall be determined with sole regard to profits earned by businesses carried on or transactions effected in Cameroon, subject to the provisions of international conventions.

Section 5 (a).- (1) The following shall be deemed to be operating in Cameroon:

- Undertakings headquartered in Cameroon or with effective management office in Cameroon

- Undertakings that have a permanent establishment in Cameroon;

- Undertakings that have a dependent representative in Cameroon.

(2) The profits of the undertakings that do not fulfil the conditions referred to

in paragraph (1) above shall be taxable in Cameroon where they carry out activities that form a full business cycle in Cameroon.

Section 6.-(1) The taxable profits shall be the net profits determined according to the results of all transactions of any kind effected by the undertaking during the period of assessment including, in particular, the transfer of any assets in the course of or on the completion of trading.

(2) The net profit shall consist of the difference between the value of the net assets at the closing and opening of the period whose results will serve as a basis for assessment, reduced by the additional assets brought in and increased by the drawings effected by members during this period. By net assets is meant the surplus of the value of assets over the total liabilities made up by third-party claims, depreciation and justified provisions.

(3) Stocks shall be valued at cost price; if the market price is lower than the cost price, the undertaking shall make provisions for depreciation of stock. Work in hand shall be valued at cost.

Section 7.- Net taxable profit shall be established after deduction of all costs directly necessitated by the exercise of activities subject to assessment in Cameroon, in particular:

A- Overhead expenses

All types of overheads, expenses on staff, labour, offices, equipment and furniture, sundry and exceptional expenditure, insurance premiums, acts of

liberality, gifts and subsidies.

However, the following expenses shall

be treated thus:

(1) Sundry remunerations and provision of services:

a) The remuneration granted to salary

and wage-earners shall be deductible from the results in so far as they are not excessive in comparison to the service rendered, correspond to effective work, and are in conformity with conventional norms.

This provision shall apply to all direct and indirect remuneration, including compensations, allowances, benefits in kind and reimbursement of expenses.

Nevertheless, a deduction to the tune

of 15% shall be made on the basic salary excluding other social welfare contributions representing only employers’ dues paid abroad for the compulsory constitution of the pension of an expatriate.

b) The attendance fees granted to the members of the board of directors shall be deductible only in so far as they represent remuneration for work done.

c) The fixed allowances which a company grants to its managerial or senior staff as entertainment and travelling expenses shall be excluded from such deductible expenses in the assessment of tax, when they include the usual type of expenses reimbursed to the persons concerned.

The sums paid to the managerial or senior staff of a company as employment or service expenses allowance which do not correspond to a real expense on the duty performed shall be reinstated in the operating results.

For the implementation of this provision, managers shall mean active partners and members of partnerships and joint-ventures.

All expenses relating to hunting, angling, the use of pleasure boats, tourist planes and pleasure homes shall

equally be excluded from the deductible expenses whether they be in the form of fixed allowances or reimbursement expenses.

d) Subject to international agreements, the following shall be regarded as expenses on condition that they are not exaggerated:

• Head office overheads for operations carried put in Cameroon and the remuneration of certain effective services (studies; technical, financial or accounting assistance) provided to Cameroonian firms by foreign or Cameroonian natural persons or corporate bodies.

On no account shall there be accepted on this basis any sum exceeding 5% of the taxable profit before deducting the expenses concerned.

In case of a deficit, this provision shall apply to the results of the last financial year not prescribed.

This ceiling shall not apply to expenses relating to technical assistance and studies concerning the assembly of a factory.

The ceiling stipulated above shall be fixed at 2.5% of the turnover for the firms specialized in public works and 7.5% for design firms operating in accordance with the regulations relating to design firms and consulting engineers.

•purchased or sold for firms located in Cameroon within the limit of 5% of the purchase or sales price. This commission must form the subject of a specific bill attached to that of the suppliers or clients.

The amounts paid for the use of valid patents, brands, designs and models within the overall limit of 2.5% taxable profit before the deduction of expenses claimed. This ceiling shall not apply to the amounts paid to firms not participating directly or indirectly in the management or capital of a Cameroonian firm.

• Commission or brokerage on goods When their partners on the payroll of the firm are on leave, companies shall be authorized to deduct from their profits, on condition that the journey was made, the transport expenses to

and fro of the said partners, their spouses and dependent children.

Under no circumstances shall such expenses give rise to a depreciation allowance account.

(2) Rental Expenditure

The amount for rentals granted to a company shall be regarded as part of the expenses on condition that it is not

exaggerated in comparison with the rentals usually paid for similar property or facilities.

Nevertheless, when a partner has at least 10% of the holdings or shares of a company, the proceeds from the rentals other than those from the property granted to such company shall not be considered as expenses of the firm.

For the implementation of this provision, the holdings or shares held as property or as usufruct by the spouse, relatives in the ascending or descending line of the partner, shall be deemed to belong to the partner.

(3) Taxes, charges and fines

Only the professional taxes issued for

collection during the financial year and which are to be borne by the firm

in relation to the operations carried out in Cameroon shall be subject to deduction.

Company tax and personal income tax shall not be considered as deductible expenses for the levying of taxes.

Rebates granted on the deductible taxes shall fall under the revenue of the financial year during which the company shall be notified of the authorization of payment thereof.

Compounding fees, fines, confiscations, any penalty concerning persons who violate the legal, economic and fiscal provisions shall not be deducted from the profits subject to taxation.

(4) Insurance Premiums

The following shall be deducted from

the taxable profits and specifically relating to the share of operations carried out in Cameroon:

-insurance premiums contracted for the company where the very risk covered leads directly to a net reduction of assets;

--insurance premiums which, themselves, represent operating costs;

sickness insurance premiums paid to local insurance companies for members of staff and their spouses and dependent children, where the reimbursement of expenses to the very persons fails to appear under deductible charges;

- Premiums paid by firms to local insurance companies undercontracts relating to career wind-down allowances.

Deduction of such contributions shall only be admitted on condition that it is a general insurance contract, that is, one that concerns the entire staff or one or several specific categories of the staff.

But the sums raised by the company

with a view to taking out its own insurance policy shall not be deductible from taxable profits.

(5) Acts of liberality, gifts and

subsidies

Acts of liberality, gifts and subsidies

shall not represent the charges deductible from profits.

However, payments made to research

and development bodies and to collective philanthropic, educational, sports, scientific, social and family institutions and bodies, on condition that the latter are situated in Cameroon, shall be deductible as soon as there is proof of payment and as long as they do not exceed 0.5% of the turnover for the financial year.

Donations, grants and subsidies awarded to clubs participating in elite national competitions, or to recognized organizations responsible for the organization of official sports competitions are deductible when they are justified and within the limit of 5% of the annual turnover.

However, shall be totally deductible

when justified, the sums granted to;

- the State or Decentralized Territorial Collectivities for the fight against HIV/AIDS;

- authorize research and development bodies located in Cameroon and exercising in the health, agriculture and animal husbandry domains.

Similarly, gifts made on the occasion of a disaster, shall be deducted in the form and conditions determined by order of the Minister of Finance.

B - Financial Costs

Interest on sums of money left or

placed at the disposal of the company by partners in addition to their capital shares, irrespective of the form of the company, within the limit of those calculated at the rate of Central Bank advances increased by two percentage points.

However, such deduction shall possible with respect to partners who directly or indirectly own at least 25%

of the share capital or corporate voting rights only if:

-The sums of money made available

by all the partners do not exceed two and a half times the amount of equity. Otherwise, interest on the excess amount shall not be deductible;

-There interest paid to the said partners does not exceed 25% of profit before corporate tax and before deduction of the said interest and amortizations taken into account in determining such profit. Otherwise, the excess amount of interest shall not be deductible.

C - Losses

The following shall be deductible

from profits:

- Losses on items of fixed or realizable assets, except losses resulting from misappropriation by a partner or manager of the enterprise, or where misappropriation is as a result of negligence on the part of managers.

- the losses relating to bad debts exhausting all the amicable or forced means of recovery provided for by the OHADA Uniform Act on the Organization of Simplified Recovery Procedures and enforcement procedures;

- Losses due to damage duly established and validated in the presence of a taxation officer with at least the rank of an inspector, under the

conditions specified in the Tax Procedures Manual.

D - Depreciation

Depreciation actually computed in consideration of the probable period of usage according to the norms of each operation, including those which might have already been deferred in times of deficit without using rates which may not exceed those fixed as follows:

Small equipment and tools

The threshold for small equipment and tools which should be recorded under assets shall be fixed at five hundred thousand (500, 000) CFA francs.

Construction

Commercial and industrial buildings, garages, workshops and sheds ........ 5%

Processing cabins ......................................................................................... 5%

Dam waterfall installations ........................................................................... 5%

Factories ....................................................................................................... 5%

Dwelling houses ........................................................................................... 5%

Lime-kilns and plaster ........................................................................... 10%

Electric furnaces .................................................................................... 10%

Temporary or demountable buildings ........................................................ 20%

Stationary and fixed Equipment

Steam – boilers ...........................................................................................10%

Concrete tank ................................................................................................ 5%

Electric-power transmission-lines:

* permanent ................................................................................................ 15%

* temporary ................................................................................................ 20%

Paper and cotton machines .................................................................... 10%

Oil refining equipment (reforming, visbreaking and distilling

equipment) .................................................................................................. 10%

Hydraulic presses ....................................................................................... 10%

Compressor presses .................................................................................... 10%

Heavy-oil engine ........................................................................................ 10%

Oil tanks ..................................................................................................... 10%

Heavy and high voltage transformers ......................................................... 10%

Turbines and steam machines ..................................................................... 10%

Mobile equipment

Kneading machines and mixers .................................................................. 15%

Excavators .................................................................................................. 15%

Tanks, brewery distilling and verification tanks ........................................ 10%

Wood-cutting equipment ............................................................................ 20%

Purification and titration equipment ........................................................... 10%

Rolling and spinning appliances ........................................................... 10%

Lightwheight machines, lathes, slotting machines, planers and

drilling-machines ........................................................................................ 20%

Factory equipment, including machine-tools ............................................. 20%

Hammers tires ............................................................................................ 20%

Perforators .................................................................................................. 20%

Hand tools known as small tools .............................................................. 100%

Transportation equipment

Carts............................................................................................................ 25%

Naval and air equipment ............................................................................. 20%

Transport barrels (beer, wine) .................................................................... 20%

Metallic transport drums ........................................................................ 20%

Containers ................................................................................................... 25%

Locomotive equipment:

* Light equipment used in towns ............................................................. 25%

* Light equipment for rental and driving schools ............................... 33.33%

Heavy or used in the bush ..................................................................... 33.33%

Tractors ................................................................................................. 20%

Tractors used in forest exploitation ....................................................... 33.33%

Port handling equipment:

* Freight-elevators ................................................................................... 20%

* Large cranes .......................................................................................... 10%

* Self-propelling cranes .......................................................................... 10%

* Railways .................................................................................................. 5%

* Trucks ...................................................................................................... 5%

Railway Lines

Rails .............................................................................................................. 5%

Wood sleepers ......................................................................................... 6.67%

Double block sleepers .................................................................................. 5%

Steel sleepers ................................................................................................ 5%

Ballast ......................................................................................................... 10%

Platform ........................................................................................................ 5%

Leased Lines ................................................................................................. 1%

Passenger carriages ...................................................................................... 5%

Line-side structures

Culverts- box drains- road beds- earth structures .................................... 6.67%

Bridges, Tunnels – Viaducts ........................................................................ 5%

Level crossings ............................................................................................. 5%

Leased line-side structures ........................................................................... 2%

Locomotives

Purchase of new engines or engines below 10 years ................................... 5%

Rehabilitation

Body of the engine ....................................................................................... 5%

Diesel engines .............................................................................................. 5%

Traction engines ........................................................................................... 5%

Complete overhaul of CC engines .......................................................... 8.33%

Complete overhaul of BB engines ........................................................ 12.55%

Partial overhaul of CC engines .............................................................. 16.67%

Partial overhaul of BB engines ................................................................... 25%

Second-hand rail cars .............................................................................. 10%

Road engines ................................................................................................ 5%

Other equipment used for railway activities

Radio equipment and modems ................................................................... 15%

Antennas, beams and level crossing signs ................................................. 20%

Leased telecommunications and flagging equipment .................................. 5%

Passenger transport vehicles ........................................................................ 5%

Goods transport carriages ............................................................................. 5%

Furniture and Fittings and other equipment

Furniture and fittings and other equipment ................................................ 10%

Office-furniture and others ..................................................................... 10%

Data-processing equipment ........................................................................ 25%

Reproduction equipment ....................................................................... 33.33%

Special Depreciation

Fishing equipment

Fishing vessels ............................................................................................ 15%

Hotels, bars, restaurants

Glassware, plates and dishes, kitchen utensil ............................................. 50%

Linen ................................................................................................... 33.33%

Silverware ................................................................................................... 20%

Decoratives ................................................................................................. 20%

Carpets, curtains and dyeing materials ....................................................... 25%

Fridges and air-conditioners ....................................................................... 25%

Cookers ....................................................................................................... 20%

Plastic materials (moulding)

Moulds ................................................................................................... 33.33%

Pre-heaters or stoves ................................................................................... 20%

Pelletizers ................................................................................................... 20%

Injection press ............................................................................................ 20%

Light shaping machines: Metallizing machines ......................................... 20%

Welding machines and cutters ................................................................... 20%

Crushing presses ......................................................................................... 10%

Gelling and plastification machines ........................................................... 20%

Transfer press ............................................................................................. 10%

Equipment using chemicals

Washers and mixers ................................................................................... 20%

Recycling appliances .................................................................................. 20%

Bleaching appliances .................................................................................. 20%

Cooking appliances ................................................................................... 20%

E - Provisions

Provisions constituted to meet clearly specified losses or charges rendered probable by the course of events, provided that they are shown in the annual accounts and appear in the statement of provisions specified in Section 18 hereafter.

Concerning credit establishments, with the exception of provisions for bad debts whose allocation is optional, the deduction of provisions for bad debts and doubtful commitments shall be effected as follows:

- two years for bad debts and doubtful commitments whose risks are not covered either by collateral securities or State guarantee. In this case, deduction may not exceed 50% of bad debts and commitments per annum;

- three years for bad debts and doubtful commitments whose risks are not covered by collateral secur ities. In this case, deductions may not exceed:

  • 25 % for the first year,
  • 50 % for the second year,
  • 25 % for the third year.

The situation of these provisions must be definitely determined at the end of the third year of their constitution, with the exception of those which concern bad debts and doubtful commitments brought before law courts. The technical provisions of insurance companies, constituted in accordance with the rules and methods prescribed by the code of the inter-african Conference on Insurance markets (CIMA). In no event shall any provision be constituted for charges accountable, by their nature, in the year in which they are incurred.

F - Claims and debts expressed in****foreign currency

Losses incurred during exchange transactions may not require the accumulation of deductible provisions. However, currency conversion margins, claims and debts expressed in foreign currencies, as opposed to the amounts initially entered into the accounts, shall be assessed at the end of each financial year, taking into account exchange rates which are used to determine the taxable turnover for the financial year. Currency conversion margins concerning less than one yearold debts expressed in foreign currencies shall be deductible in determining the taxable turnover for the same financial year.

But currency conversion margins concerning long-term debts expressed in foreign currencies shall be deductible at the rate of actual reimbursements.

The same shall be true for short and medium term claims.

Section 8.-Repealed – FL 2006

Section 8 a.-(1) The expenses referred to in Section 7 above equal to or

greater than CFAF 500 000 (five hundred thousand) shall not be deductible when paid in cash.

(2) The following taxes shall also be non-deductible:

- Expenses supported by invoices not bearing a single Identification number on the tax payers card, to the exclusion of invoices submitted by foreign suppliers;

- Expenses relating to remunerations of all kinds paid to liberal professionals exercising in violation of the regulations governing their respective profession.

Section 8 (b) (new).- (1) The cost and remunerations of all types posted in the accounts records by a natural persons or legal entity resident or estab-

lished in Cameroon and linked to transactions with natural persons or legal entities resident or established in a territory or state considered to be a tax haven, shall not be deductible in determining the company tax or income tax of individuals in Cameroon.

(2) However, property and merchandise required for production purchased in their country of production and which have been cleared at the customs, as well as remuneration for services rendered in relation thereto shall be deductible.

(3) Any state or territory wherein the tax on income of a natural person or

legal entity is less than a third of that paid in Cameroon, or any state territory considered not to be cooperative in matters of transparency or exchange of information required for fiscal purposes by international financial organizations shall be considered a tax haven.

Section 9.- Capital gains, other than those realized on merchandise, resulting from the gratuitous allocation of shares, founders’ shares, partnership shares or debentures on the merger of office in Cameroon or another CEMAC State.

The same rule shall apply where a company or a limited liability company transfers the whole of its assets to two or more companies formed for the purpose (split) or assigns part of its assets to another company constituted in any of the said forms (partial contribution of assets) on condition that:

  • the assignee companies have their registered office in Cameroon or in another CEMAC country;
  • the contributions resulting from these conventions shall take effect on the same date for the various assignee companies and shall thus entail the immediate dissolution of the assignor company in the event of merger or split.

However, the application of the provisions of this Section shall be subject to the obligation established in the instrument of merger or contribution, to calculate in respect of assets other than merchandise included in the contribution, the annual depreciation to be set against profits and the subsequent capital gains resulting from the realization of such assets on the basis of their cost to the merging or contributing companies, less any depreciation already shown by them.

This obligation shall bind the new company or the company taking over in the case mentioned in paragraph 1, and either respectively the assignee companies proportional to the value of the assets assigned or the company benefiting by the contribution, in the case mentioned in paragraph 2.

Section 10.- Notwithstanding the provisions of Section 6(1) of this companies and limited liability companies, even where they operate as sole proprietorships, shall be exempt from tax levied on company profits provided that the company taking over or the new company has its registered 1719 Code and in the case of total or partial sale, transfer or termination of the activity, the net capital gains, i.e. those obtained after the deduction, if any, of realized losses, sustained in the transfer of fixed assets, and allowances in exchange or as compensation for the cessation of the practice of the profession (activity) or transfer of the clientele, are taxed as follows:

  • For half of their value when the cessation, transfer or termination takes place less than five years after the creation, purchase of the business or clientele;
  • For a third or their value otherwise.

Section 11.- In the case of cooperative societies, bonuses realized from transactions with members and shared among them proportionately to their order shall be deductible from profits.

Section 12.- Any loss sustained in a given year shall be considered a charge on the following year and deductible from profits made in that year. Should this profit be inadequate for the deduction to be made in its entirety, the loss still outstanding shall be carried forward to subsequent years up to the third year after the initial loss.

Section 13.- Where a joint stock company or a limited liability company owns either registered stock in a jointstock company or shares in a limited liability company, the net proceeds of the shares in the second company paid to the first during the financial year shall be deducted from the total net profit of the latter, less a percentage for costs and charges.

This percentage shall be fixed at 10% of the total amount of the said proceeds.

However, this provision shall apply only:

(1) When the stocks or shares owned by the parent establishment represents at least 25% of the capital of the subsidiary firm.

(2) When the parent and subsidiary firms have their registered office in a CEMAC State.

(3) When the stocks or shares allotted at the time of issue are still registered in the name of the participating company which undertakes to retain them for two consecutive years at least in registered form.

Any breach of this undertaking shall result in the assessment of the improperly exempted income, without prejudice to the penalties enforceable for inadequate returns.

Concerning banking and credit establishments, firms engaged in the investment or management of transferable securities, all arrears, and interest of other proceeds exempt from the tax on income from securities shall be excluded from the deduction above.

DIVISION IV

PLACE OF ASSESSMENT

Section 14.- The company tax shall be established under a single assessment in the name of the corporate body or association for all taxable transactions in Cameroon, either at its registered office or, failing that, at the place of its principal establishment.

However, for undertakings under a specialized management unit, filing of tax returns and payments shall be done therein.

In the case of corporate bodies situated outside Cameroon and having a direct or interdependent relationship with other corporate bodies or undertakings established in Cameroon, the place of assessment shall be the same as that of the corporate bodies or undertakings with which they have these relations. The latter shall be jointly and severally responsible for the payment of the tax payable by corporate bodies established outside Cameroon.

In the cases referred to in Section 3(3) of this Code, the tax shall be established in the name of the company or of the manager known to third parties and at the base of the common headquarters or of the principal establishment.

DIVISION V

PERIOD OF ASSESSMENT

Section 15.- The company tax shall be assessed on the profits realized during the twelve-month period correspondding to the financial year.

However, companies that start their business within the six (06) months preceding the prescribed closing date may draw up their first balance sheet at the end of the financial year following the twelve-month period in which they started activities.

Section 16.- Where successive balance sheets are drawn up during the same fiscal year, the results shall be added together for the assessment of the tax due for the following financial year.

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